The United States Supreme Court has ruled that New Jersey is permitted to exit the Waterfront Commission Compact it previously established with New York.
The two-member compact was created in 1953 by New York and New Jersey to address labour corruption in the respective ports.
The disbandment of the Waterfront Commission of New York Harbor, which oversees mandatory employment licensing for waterfront workers and conducts law enforcement probes in the port, is now imminent due to this decision.
The ruling is based on the fact that the Waterfront Commission Compact did not have an explicit clause preventing either state from leaving the agreement.
New Jersey initiated its request to withdraw from the Waterfront Commission in 2018, citing that the compact was no longer necessary as organised crime no longer controlled hiring on the docks. The state also argued that the compact had impeded hiring on the docks as, at the time of the compact’s inception, approximately 70 per cent of waterfront employees worked on the New York side.
New York opposed New Jersey’s bid to exit the compact, contending that it would adversely impact their efforts to fight crime on the docks.
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Justice Brett Kavanaugh authored the majority opinion in the case, in which he stated that “principles of state sovereignty likewise support New Jersey’s position” and that “the Compact involves the delegation of a fundamental aspect of a State’s sovereign power – its ability to protect the people, property, and economic activity within its borders – to a bistate agency.”
Kavanaugh also noted that the Compact neither expressly allows nor expressly prohibits unilateral withdrawal, and that it was never intended to operate indefinitely.
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After five years of litigation in federal district and appeals courts, the ruling is a victory for New Jersey Governor Phil Murphy. In response to the unanimous ruling in his state’s favour, Murphy expressed his delight, stating: “New Jersey’s sovereign right to govern our ports has been vindicated.”
New York Governor Kathy Hochul and Attorney General Letitia James expressed disappointment with the Supreme Court’s decision, and affirmed they they will continue to combat corruption and crime, protect the health of the economy, and ensure the safety of New Yorkers to the best of their abilities.
The Port Authority of New York and New Jersey (PANYNJ) handled 571,177 TEU in February, the highest amount of cargo recorded among US ports.
The port exceeded the Port of Los Angeles by more than 83,000 TEU and the Port of Long Beach by more than 27,000 TEU.